Australian telco Telstra is to start trialling its new 'T-box' service this week, enabling the company's broadband subscribers to access video-on-demand services via Telstra-owned sites such as BigPond, according to reports in local website news.com.au.

The new set-top box will also allow users to watch broadcast channels from BigPond including news and sport, and will include PVR features and time-shifting options. The report quotes Telstra insiders as saying that the new service will augment the company's content offering without competing with premium pay-TV brand Foxtel, in which Telstra owns a 50% stake.

Telstra is currently embroiled in tough negotiations with the Australian government over the country's nascent National Broadband Network (NBN), concerning the government's desire to force Telstra to sell infrastructure assets into the new network.

If trials of the new T-box service are successful, it is expected to be launched next year.